Stocks to buy: Lemon Tree gearing up for upmove, chartists see up to 12% rally in 3 months

Promoted by Patanjali Keswani, Lemon Tree (LTHL) is the largest hotel chain in the mid-priced segment in India. It operates 8,497 rooms in 87 hotels across 54 destinations in India and abroad.

Stocks to buy: Lemon Tree gearing up for upmove, chartists see up to 12% rally in 3 months
So far this year, Lemon Tree shares have rallied over 50%. The stock was quoting at Rs 73, up 6% on NSE intraday.

After closing in red in the previous session, Indian equity markets were up in green on Friday, helped by the RBI Monetary Policy Committee’s decision to hike rates by 50 basis points — on expected lines. S&P BSE Sesnex rose 250 points or 0.44% to cross 58,500 while the NSE Nifty 50 index was hovering around 17,450. In the last one month, both indices have rallied around 10% and analysts expect the upward momentum to continue. Stock specific action is likely amid volatility. Analysts at ICICIDirect have picked Lemon Tree as their gladiator stock stating that share price may rally 12% in the three months amid recovery in the hospitality sector.

The brokerage stated in its report that the hospitality sector has been in limelight as it has shown resilience in the recent volatile scenario. “Within the space, we remain constructive on Lemon Tree as the stock has bounced from lower band of rising channel and is set to resolve above four months consolidation (Rs 71-57), indicating resumption of primary up trend that augurs well for next leg of up move, it said. According to the analysts, in the channelised move since April last year, the stock bounced from 10 weeks EMA on multiple occasions that eventually provided fresh entry opportunity.

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Lemon Tree stock to resolve higher, gradually head towards Rs 79

Charts show that in the current scenario, the stock has formed a higher base above 10 week’s EMA, highlighting inherent strength. Structurally, the stock has formed a higher high-low on the yearly chart after three years, indicating structural improvement. “We expect the stock to resolve higher and gradually head towards Rs 79 levels in coming months as it is the 161.8% external retracement of AprilMay decline (Rs 71-57),” it said. ICICIDirect recommends buying the stock in the Rs 65-68.20 range, keeping stop loss at Rs 61. Target price is Rs 79, implying 12% upside in a quarter.

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Stock outperforms Nifty 50 so far in 2022

Promoted by Patanjali Keswani, Lemon Tree (LTHL) is the largest hotel chain in the mid-priced segment in India. It operates 8,497 rooms in 87 hotels across 54 destinations in India and abroad under brands like Aurika (premium), Lemon Tree premier, Lemon Tree (midscale), RedFox (economy) and Keys. Analysts believe that the company’s large asset base, strategic partnership and financial flexibility would continue to support the liquidity profile, if further need arises. So far this year, Lemon Tree shares have rallied over 50%. The stock was quoting at Rs 73, up 6% on NSE intraday.

(The stock recommendations in this story are by the respective research analysts and brokerage firms. FinancialExpress.com does not bear any responsibility for their investment advice. Capital markets investments are subject to rules and regulations. Please consult your investment advisor before investing.)

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